Industry reps talk mining at State Capitol

Resources committees updated on production

Mike Satre, Executive Director of the Council of Alaska Producers, along with Karen Matthias, right, a consultant for the Council of Alaska Producers, and Deantha Crockett, Executive Director of the Alaska Miners Association, gives an mining industry briefing to a Joint House/Senate Resources Committee at the Capitol on Wednesday.

Sen. Cathy Giessel, R-Anchorage, left, and Sen. Anna Fairclough, R-Eagle River, listen to Mike Satre, Executive Director of the Council of Alaska Producers, Karen Matthias, a consultant for the Council of Alaska Producers, and Deantha Crockett, Executive Director of the Alaska Miners Association, give an mining industry briefing to a Joint House/Senate Resources Committee at the Capitol on Wednesday.

Juneau’s Michael Satre and other representatives of Alaska’s mining industry gave a presentation Wednesday to a joint meeting of the House and Senate Resources committees in which they described Alaska’s mining sector as a major player in the United States and the world.

Satre, who is the executive director of the Council of Alaska Producers as well as the chairman of the City and Borough of Juneau Planning Commission, said Alaska contributes a substantial amount of silver, lead, zinc and other metals produced in the U.S. every year due to large mines in Southeast Alaska and elsewhere.

“Alaska is an incredible producer of silver,” Satre said, presenting numbers that show Alaska produces about 13 million ounces of silver per year — about 38 percent of total U.S. annual production, which he listed as 34 million.

Much of Alaska’s silver, Satre added, is produced at the Hecla Greens Creek mine on Admiralty Island, for which he works as a spokesman. The mine is a major employer in Juneau.

Alaska is the U.S. leader in the production of zinc, another metal mined at Greens Creek, although the Red Dog mine in Northern Alaska is the largest zinc producer, according to Satre.

“We produce an exceptional amount of lead and zinc,” said Satre.

Indeed, Alaska accounts for about 690,000 tons of zinc out of the 825,000 produced in the U.S. every year, numbers in Satre’s presentation indicate. Worldwide annual production is 14 million tons.

According to the same table, some 155,000 tons of lead — more than 40 percent of U.S. production — come out of Alaska every year. That compares to 5.7 tons produced around the world per year.

Alaska is a less consequential producer of gold, Satre said. The precious metal lured thousands to Alaska during the gold rush days at the turn of the 20th century. But today, Alaska produces less than 1 million ounces of gold per year out of 7.3 million ounces in the entire U.S., according to Satre.

“That will put us supplying roughly a seventh of the U.S. production, but we still lag far behind the rest of the world in terms of worldwide annual production,” said Satre. “We have some opportunities in the state to increase our percentage.”

Another planned mine in Southeast Alaska, Heatherdale Resources’ Niblack site near Ketchikan, was listed by Satre as a gold “developer.” So was the controversial Pebble mine, a proposed operation being explored by the Pebble Partnership in Bristol Bay.

Satre acknowledged that Alaska does not currently produce copper or rare earth metals, although he noted that projects like Pebble and Ucore Rare Metals Inc.’s planned Bokan Dotson Ridge mining operation on Prince of Wales Island could change that.

“We really like ultimately Alaska could play a critical role in supplying these to the United States, just as we play an important role supplying these other metals to the nation and worldwide,” Satre said of the rare earth elements Ucore expects to mine from Bokan Mountain.

Karen Matthias, who is the incoming management consultant for the Council of Alaska Producers, also spoke on the state of mining investment in Alaska.

“The bottom line is that’s very difficult to predict commodity prices, and that makes it very difficult to attract investment and to judge economic feasibility for a project that may be five, 10, 15 years away from production,” said Matthias. “Where does Alaska fit into that global picture? Well, Alaska has to compete for investment dollars with mining projects all around the world.”

At the end of the presentation, which only lasted about 25 minutes in total, committee chairwoman Sen. Cathy Giessel, R-Anchorage, brought up a hydroelectric power project in Juneau and its connection to the Greens Creek mine.

“I heard recently about the Lake Dorothy hydro project here in Juneau, which, because of Greens Creek, there was additional need for hydropower here in Juneau, which of course ultimately benefits all of the consumers here in terms of their cost per kilowatt-hour,” said Giessel, one of the Alaska State Legislature’s most ardent supporters of mining. “So mining contributes in so many ways to the economy of communities.”

Greens Creek paid for much of the Lake Dorothy development, which went online in 2009 after a lengthy construction process that saw its expected project cost more than double over time.